Personalization Is Giving Customers What They Want Before They Demand It Reallocate your savings from automation to deliver a better customer experience, based on personalization.
By Tara Sporrer Edited by Frances Dodds
Opinions expressed by Entrepreneur contributors are their own.
Artificial intelligence, messaging bots and other automation technologies are all well and good, but they can't help your business if you're not using them to give customers what they really want. Think it's all about making things easier? Think again.
The fact is, easy isn't enough anymore. Automated self-service is old news, and when it comes at the expense of building a personal connection, you're leaving the door open for someone else to lure customers away with a more engaging and helpful approach. As consumer expectations continue to rise, it's the companies that use automation as just one element of a richer experience that will stand out from the competition, earning real customer loyalty.
Are you automating for the right reason?
People often think of automation primarily as a way to reduce cost. That's certainly one reason to do it, but it's not the only one. It's also crucial to make sure you're giving customers what they want, with the kind of experience that will keep them coming back.
Consider one of the first instances of self-service: the ATM. It allows a bank's customers to access cash and other services without having to go into the branch - or even go anywhere near one -- with a simple experience that lets them complete their task quickly. Today, mobile banking apps go even further, allowing customers to check balances, transfer funds and even deposit checks from anywhere. So far, so good.
On the other hand, the self-service checkout lines now sprouting up at grocery stores and other retail outlets have a more ambiguous value proposition for customers.
Is it really better to have to look up your own produce codes, hunt for your own universal product code (UPC) symbol, bag your own goods and run your own card?
You still have to be in the store, but now you have to do everything yourself without the personal assistance you once had. Store managers might argue that it lets you skip long lines at the counter, but couldn't they just open a few of those closed registers instead? Some customers may prefer it, but many find it awkward and impersonal - a blatant case of businesses cutting costs at the expense of their customers.
Interactive voice response (IVR) systems and phone trees are already the stuff of standup comedy routines - a constant source of frustration and annoyance imposed by businesses that would do anything to avoid speaking with customers. Is this reduction in headcount really worth the corrosive effect on brand image and customer loyalty?
As you think about opportunities for automation, it's just as important to look for ways to improve the customer experience. In fact, smart businesses actually reinvest a portion of the savings yielded by automation to find new ways to please customers.
Related: What Buffer Can Teach Us About Customer Service
What is the right type of self-service?
As the ATM demonstrates, self-service isn't always a bad thing. It's only bad when it's done so poorly that it gets a bad reputation.
A single bad experience can be enough for a customer to say "never again," and at that point, the investment is wasted. The key is to understand who self-service is right for. It's not a one-size fits all approach. Knowing when and how to deliver it in a way that actually improves customers' experiences is pertinent.
This is where data comes in.
You know more than enough about each customer to understand their situation; anticipate their needs; and discover opportunities to add value. This strategy is already commonplace in the form of personalized recommendations based on the customer's current shopping session, or for people who've logged in, their history.
Recommendations are a simple win-win: the customer is exposed to offerings that they're at least somewhat likely to be interested in, and the business captures new upsell and cross-sell opportunities. But that's only the beginning.
Related: 3 Cost-Effective Ways to Increase Brand Awareness
You've filled your shopping cart, and you're about to check out, but your coupon code doesn't work. Maybe it's expired. Or maybe you're typing it in wrong. Regardless, you're not in the mood, so you're about to abandon your cart and move on. But instead, because you're a high-value customer (based on your past history and/or the items you've chosen today), the website prompts you with an alternative, guaranteed-to-work code to use. You complete the transaction with the discount you wanted, and you feel well taken care of along the way. The retailer closes the sale and creates a happy customer.
You need financing for a home improvement project and you've looked at a variety of products, but you're having a hard time sorting through the relative advantages of a home equity loan or a home equity line of credit. As your eyes glaze over at yet another payment calculator, the site seems to read your mind, offering a three-minute video entitled "Loan or Line of Credit: Which Is Right for Me?" At the end, a chat window pops up, ready to answer any of your follow-up questions. Just like that, you're finally making progress.
You're in an airport, scrambling to change flights in the middle of a day from hell. The airline app you're using knows you're in an airport and has a pretty good idea of your situation. Instead of passively sitting by while you fumble on your phone, the app offers an immediate connection to a live agent to get you taken care of as quickly and painlessly as possible. Your loyalty to that airline reaches the stratosphere.
While each of these scenarios leverages automation, it's always in the context of helping the customer - not avoiding the customer. Each step of the way, you're using data to enhance the experience by offering helpful information; eliminating pain points; making sure the customer is on the right path and using the right channel; and ensuring the best outcome.
Related: Customer Loyalty Is Spelled N-P-S
Raise the bar for a richer customer experience.
Nobody was asking for the banking industry to introduce the ATM, but once ATMs began to appear, it soon became a make-or-break customer expectation that every bank had to meet. The same dynamic applies to new online business innovations - from stored payment information to auto-fill form fields.
As more customers receive a more personalized online shopping experience, traditional, low-value self-service will appear cold and indifferent in comparison.
Companies that use automation solely for cost avoidance are chasing short-term margins at the expense of long-term relationships. By investing the savings yielded through automation, you can stay one step ahead of rising expectations and achieve better results for customers and your business.
